Wrapped HBAR
Crypto Overview
Overview
Wrapped HBAR (WHBAR) is a wrapped version of HBAR, the native cryptocurrency of the Hedera network. It is an ERC-20 token that represents HBAR on the Ethereum network, enabling HBAR holders to participate in the broader Ethereum DeFi ecosystem while maintaining a 1:1 peg with HBAR.
Intended Utility
The primary purpose of WHBAR is to bridge the Hedera and Ethereum ecosystems, allowing users to utilize their HBAR holdings in Ethereum-based applications while maintaining exposure to HBAR. Each WHBAR token is backed by an equivalent amount of HBAR held in custody.
Actual Utility
The token is currently being used as intended, primarily for cross-chain interoperability between Hedera and Ethereum networks. Users can wrap their HBAR tokens to participate in Ethereum-based DeFi protocols while maintaining their HBAR position.
Token Distribution and Governance
WHBAR is created through a wrapping process where users deposit HBAR and receive an equivalent amount of WHBAR. The supply is dynamic and directly corresponds to the amount of HBAR locked in the bridge contract. There is no pre-mine or initial token distribution to founders since tokens are only minted when users deposit HBAR.
Technology and Development
The wrapping mechanism uses smart contracts on both the Hedera and Ethereum networks to ensure secure and transparent token conversions. The technology is based on established wrapped token standards similar to WBTC and other wrapped assets.
Crypto Impact
To assign a comfort level investing in Wrapped HBAR from a halal perspective we need to determine whether it has a net positive or negative impact.
Towards this end, the table below is used to tally all the positive and negative considerations our members can think of related to Wrapped HBAR.
If you don’t see something that should be listed, positive or negative, feel free to submit your own contribution using the button “Contribute”.
We will review your contribution for accuracy before publication.
Importantly, you can review listed contributions and vote on which one you think has the greatest impact, positive or negative.
You only have one vote per asset so use it wisely.
You can change your vote if you change your mind.